Reaching climate neutrality in Estonia

This report, commissioned by the British Embassy in Tallinn, evaluates Estonia's progress toward climate neutrality by 2050, building on a 2019 SEI study. While total greenhouse gas emissions fell from 18,687.4 kt CO2e in 2018 to 11,555.8 kt CO2e in 2020, the report identifies significant gaps in the energy, buildings, industry, LULUCF, transport, and agriculture sectors. Key challenges include a lack of incentives for non-residential building renovations, lagging wind energy investment, and the LULUCF sector transitioning from a carbon sink to an emitting sector in 2020.

• Total greenhouse gas emissions in Estonia showed a downward trend, decreasing from 18,687.4 kilotons CO2 equivalent in 2018 to 11,555.8 kt CO2e in 2020, representing a 71.24% drop between 1990 and 2020.
• The buildings sector requires a significant increase in renovation pace to meet the national target of reconstructing 54 million m2 of buildings by 2050. Current financial support is heavily skewed toward residential properties, leaving commercial, industrial, and office buildings without stable funding mechanisms despite their high cost-efficiency for CO2 reduction.
• Estonia is transitioning away from oil shale, with a goal to stop its use for electricity by 2035 and all oil shale derived products by 2040. The share of oil shale in electricity production fell from 75.8% in 2018 to 40.3% in 2020.
• Investment in renewable energy capacity is lagging. While wind energy capacity grew from 636 GWh in 2018 to 760 GWh in 2020, it must reach 2640 GWh by 2030 to meet targets. Additionally, the government is planning a new shale oil refinery projected for 2024, which is viewed as a negative step for climate neutrality that could add 400,000 to 500,000 tonnes of CO2e.
• The Land use, land-use change, and forestry (LULUCF) sector, historically a carbon sink, became an emitting sector in 2020. The Fit for 55 target of sequestering 2.5 million tonnes of CO2e by 2030 is considered highly unlikely to be reached, with estimates suggesting a maximum of 1.3 million tons.
• The transport sector is struggling with a decline in sustainable commuting; only 34% of people used public transport, walked, or cycled to work in 2021, down from 36.9% in 2020. The most cost-efficient measure for emission reduction is increasing the share of CNG-fuelled cars, but no current investments are targeting this.
• In the industrial sector, there is currently no government support for decarbonizing heavy industry, although the Ida-Virumaa region is allocated EUR 340 million from the EU Just Transition Fund and the Estonian Recovery and Resilience funding includes EUR 220.2 million for the green transition of enterprises.
• Agriculture is the second largest emitting sector, and emissions are rising steadily. While most proposed measures from 2019 have been adopted to some extent, the sector has limited potential for emission decreases without reducing food production.
• The Estonian government is prioritizing hydrogen as a key tool for the green transition, allocating EUR 111 million in early 2022 to support companies in the hydrogen value chain, with further investments of over EUR 50 million planned via the Recovery and Resilience Facility.

APA

Kaaret, K., Tool, B., Suik, K., & Kirsimaa, K. (2022). Reaching climate neutrality in Estonia. Stockholm Environment Institute. https://www.sei.org/wp-content/uploads/2022/07/reaching-climate-neutrality-in-estonia-a-progress-update-report.pdf

Chicago

Kaaret, Kaidi, Brigita Tool, Karina Suik, and Kerli Kirsimaa. Reaching climate neutrality in Estonia. Stockholm Environment Institute, 2022. https://www.sei.org/wp-content/uploads/2022/07/reaching-climate-neutrality-in-estonia-a-progress-update-report.pdf.

Wikipedia

{{cite report |last1=Kaaret |first1=Kaidi |last2=Tool |first2=Brigita |last3=Suik |first3=Karina |last4=Kirsimaa |first4=Kerli |title=Reaching climate neutrality in Estonia |publisher=Stockholm Environment Institute |date=July 2022 |url=https://www.sei.org/wp-content/uploads/2022/07/reaching-climate-neutrality-in-estonia-a-progress-update-report.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{kaaret2022reaching, author = {Kaaret, Kaidi and Tool, Brigita and Suik, Karina and Kirsimaa, Kerli}, title = {{Reaching climate neutrality in Estonia}}, institution = {Stockholm Environment Institute}, year = {2022}, month = jul, url = {https://www.sei.org/wp-content/uploads/2022/07/reaching-climate-neutrality-in-estonia-a-progress-update-report.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }